Commercial Real Estate Closing Checklist

One of the main reasons that a commercial property transaction might fall through when it is near to closing is because one of the parties has forgotten an important aspect of the transaction that needs to be considered before the relevant documents can be signed.

With that in mind we have created a small checklist of things that you need to keep in mind when closing on a commercial real estate property, to make sure that you cover all of the bases.

Acquisition Documents

You need to ensure that all of the documents relating to the purchase are in place and ready. This includes all of the following:

• A signed letter of intent

• Any and all drafts of the purchase contract

• Any information relating to your legal counsel

• Access agreements

• Any client or portfolio manager authorisation that is required

• A fully completed purchase contract, that will be delivered into escrow

• Documentation for the initial cash deposits for the purchase

• Arranging for any bank accounts required to be set up

Title Matters

Title and zoning issues are also a high priority, so make sure you have the following:

• You have selected a title company whom you can send the seller's title commitment to

• Have an ALTA survey carried out and ensure you have the right documentation

• Verify that all relevant leases and assets are in the seller's name

Tenant Issues

If you are buying an apartment building or any form of commercial property where other businesses may become tenants and lease out space, you need to have all of the following:

• A current certified rent roll

• A review of all current leases and the related documentation for each.

• Your legal counsel should look over these leases and compare to the current review

• You need to look over all current tenant files

• Resolve any outstanding issues regarding lease

• Receive all reports relating to the tenants, including sales and receivables reports

• Transfer all tenant security deposits

• Review the tenant credit and payment history

• Prepare and sign the tenant Estoppel Certificates

• Final check on all documentation

Financial

The transfer of all relevant financial information is extremely important as well. This includes:

• Copies of any historical or proforma financial information

• Copies of utility bills

• Most recent tax statements

• An expense list for all expenses currently operating under the property

Litigation

You will need to consider the possibility that there is any current action against the property or the existing owners and take that into consideration.

Insurance

Getting insurance for the building is crucial, so it is important to get a quote as early into the proceedings as possible. Some of this may be covered by the Property Management Agreement.

Physical Property Inspection

Before any transaction is completed a physical property inspection must be carried out by the buyer to ensure that they are getting everything that they expect from the property.

Final Closing Documentation

To complete the transaction all of the relevant financial and legal documentation must be completed and handed in on time and be completely accurate.

Make a Fortune With Real Estate

Property consisting of land and the buildings, as well as with its natural resources such as minerals or water, crops, immovable assets of this nature and buildings or housing in general. The business of Real Estate is the profession of buying, selling, buildings or housing and renting land. Before going ahead, some important factors about estate should be kept in mind to do your job well.

Types of Real Estate

• Residential:

Containing either a single family or joint family, that is available for non-business purposes. There may be different types of housing tenure also, and the size of an apartment or house can be described in meters or square feet. But the area of “living space,” excluding the garage and other non-living spaces may differ in some countries.

Real Estate Investment

This Investment is the thing that generates income or is otherwise intended for investment purposes. Investors own multiple pieces of real estate, which serves as a primary residence.

• Commercial:

It is a property that is used the design for business solely. For instance, commercial estate includes restaurants, offices, parks, malls, gas stations and convenience stores

• Industrial:

The property that is used for industrial work. But it covers a vast range of business types and comes in all shapes and sizes.

Industrial Real Estate includes single or double-storey buildings. Small industries have flexible interior space. Large industries include medium to large warehouses and factories that are designed to store goods or manufacture.

To become.

Fortunate Real estate agents, need to be familiar with their locality, reasons to increase or decrease property prices. For instance, if a new airport or road is to be built this can increase the price of nearby houses. Equally, improvement of an area can enhance prices. The agent must be aware of recent sale prices or rental for comparable properties of the area.

To become estate agents or professionals, dealing with all residential, agricultural and commercial property. They should adhere to a code of conduct, which includes regulations about looking after their clients' money.

If the deal complete, then estate agent may charge anything from 1% to 2%, and this is calculated on the sale price of the property.

Making an online fortune as Real estate agents or agencies working most notably online, normally offer a choice of fees, most of which are paid in advance. The range of prices is from $300 to $800, which is payable in advance. Many online estate agents offer their service up front but they deferred the way of payment, it means there is nothing to pay in advance, but after a period a fee will become payable.

Property Management 101 – My Vision for Property Management

Creating an effective Vision is a way to share an understanding of a common purpose as well as to generate a clear image of the future success you strive to achieve. It is the work of leaders and the managers, to help to create this Vision.

I believe all teams require direction and Vision to become successful. Without this teams will generally flounder and success will seem like a distant image.

The Vision becomes the key driver of change and a powerful Vision has the following characteristics:

1. It outlines a compelling reason for change – People do need a reason to change, they are not going to commit to the extra effort to change without any motive.

2. It delivers a picture of the future – We all need to see what we are working towards.

3. It is focused on what needs to be achieved – Without direction we are wandering aimlessly. Tell the team what they are achieving.

4. It appeals to the long-term interest of all stakeholders – If I was a business owner, I would need to see continuous improvement before I put any further funds towards the business, including the team.

5. It can be communicated easily – Have discussions at your team meetings, put the visions on your internal communications, on your walls, on the top of your computer monitors. Live it and breathe it.

Teams without clear direction often experience the following obstacles to high performance:

1. Increased conflict among team members on how to achieve goals – Too many bosses and no clear direction or vision equals everyone heading in a different direction.

2. Lack of agreement on team direction – No one is clear how to get to the goal.

3. Team activity does not translate into clear progress – It is hard to progress with-out knowing where the team is headed.

4. People work in different directions – All roads do not lead to Rome! It is perfectly fine for people to work on a slightly different route if the destination is the same.

5. A lack of focus on future success can lead to setbacks When staff have no vision, they become disheartened. They ask questions like: Why bother? Why do I come to work every day? What are we accomplishing by being here?

Improvements in team effectiveness that come from a clear, compelling Vision of the future lead to new paths of excellence. I would love to hear about your visions and direction for the future of your team.

How Property Management Firms Are Making Affordable Housing Desirable

According to the Economic Times, “affordable housing” refers to housing options within the budget of those whose income is below the median household income of a particular area. While some may assume that affordable housing automatically means giving up certain amenities that are common in society today, property management companies all over the country are working to ensure that this is not the case. Indeed, in 2016, low income doesn't have to mean low quality. From the very basic needs of safety and shelter to the most deluxe offerings like on-site laundry facilities and fully equipped community areas, property management companies are providing rentals that get the most out of every dollar. Whether you are looking for a cozy apartment or a large, master-planned community with organized activities, you don't have to sacrifice access for affordability.

The need for affordable housing spans every demographic and age group, and property management companies take note. For instance, some rentals provide amenities geared toward older residents, such as retirement facilities with mobility-accessible features, while others are more geared toward families, offering two bedroom units with balconies and lots of storage space. Because families typically include children of school age, some communities will be established in areas with access to great schools and within proximity to local restaurants and entertainment. Many rental communities also include extras like off-street parking and built-in alarm systems, as well as access to on-site recreational activities.

Regardless of your specific needs, a property management company can assist you with locating properties available in your price range and working through the application process. Not all managers are created equal, so to ensure you're getting the best representation and amenities available, look for certifications or designations from organizations like the Institute of Real Estate Management or the National Association of Realtors. Ideally, you want to work with a company that has a long history in the industry, with many years of expertise and a clear passion for providing tenants with wonderful homes. The company should also have a cooperative relationship with HUD, the government's Housing and Urban Development agency, whose mission is to create strong, sustainable communities and quality affordable homes for all.

In addition to providing leasing services to tenants and management services to property owners, many property management companies also act as development consultants or work to obtain federal funding for affordable housing projects in their communities. This commitment to providing a platform for individuals and families to gain access to a place to live and work benefits everyone involved, from saving taxpayers money by reducing demand for government services, to improving education for students who would otherwise be moving around when their parents are unable to afford a stable home.

Property Management 101 – Branding Rental Properties

From a Property Management point of view, branding covers personal branding of the Property Managers. This includes signage (office and street sign boards), the office, the website, profiles, uniforms, brochures, window cards and the properties that they are leasing out.

If a home is not well presented it will reflect on the property manager and owner as well as the real estate business and will not attract the desired tenants. While some Landlords understand this and keep their homes well presented, others do not see the relevance.

I always suggest that our Landlords, where possible, do a drive-by or visit their property at least once a year. Things like faded paint, overgrown trees, leaning fences etc. really do put off tenants and your investment becomes ‘the rental' in the street. It can also mean the difference between good tenants and the not so desirable applying for your property.

Most repairs and upgrades are tax deductible and actually prevent further high maintenance costs. Your tenants will also appreciate the upgrades ensuring the tenants stay longer term which minimizes costs and gives you security. You can also consider that tax depreciation will ensure higher tax returns on your investment.

It would be worth considering some internal works between tenants as well. You may consider painting throughout the property, changing carpets or window fittings or re-laying tiles or even staining wooden floors. All of these items are really difficult to do with tenants in the house. It is hard to predict how long someone will live in your property and no-one wants to move a great tenant out to do renovations. Just doing one of these things between tenants at each change can boost your rental income.

While a good Property Manager will inform you of this, it still sometimes helps to see it for yourself so you can make an informed decision on routine maintenance and future preventative or upgrade maintenance. Ask them to help with quotes, arrange tradesmen, organize key collection, even to pay invoices on your behalf.

I believe there are three types of maintenance on your investment property:

1. Routine repairs: These are run of the mill, wear and tear items. Routine repairs could be dripping taps, broken down air conditioners or a garage door that does not roll smoothly.

2. Emergency repairs: These are unexpected and usually require immediate repair. Emergency repairs include hot water systems splitting/exploding, a gas leak, plumbing backing up or bursting or securing the property.

3. Future repairs: This is your long term list for things to do when you have the money or between tenants. Future repairs include things like carpet replacement and painting as above.

There is also another side to consider. Don't spend so much that you don't have an income. While it is lovely to make everyone happy, it is still an investment so every bell and whistle is not necessary.

Did you know you can attend a routine inspection at your property? It might be worth considering.